A1 Bulgaria - „You Lead“

Logo A1 BulgariaIn Bulgaria, the performance in 2016 was again characterised by a competitive environment, which is particularly visible in the business segment. To counter price pressure, A1 Bulgaria intensified its focus on value-based management and its efforts to retain high-value customers. The Bulgarian mobile market also saw a shift from prepaid to postpaid offers. These factors meant that the downturn in service revenues slowed considerably in 2016 compared with the previous years. Management also aimed to mitigate revenue pressure on profitability by means of strict cost management.

The number of wireless subscribers declined by 3.0% in the year under review in line with the general market trend, attributable exclusively to losses in the prepaid segment. The ongoing rise in the use of mobile data led to a further year-on-year increase in the number of mobile broadband customers of 19.7% to over 382,400. Although the mobile market share declined from 38.8% to 38.4%, the aforementioned focus on value-oriented retention resulted in an increased share of contract customers, 85.4% (2015: 82.5%). In the fixed-line business, revenue generating units (RGUs) increased by 0.7% year-on-year due to the growing popularity of bundled products with TV and the increased demand for broadband products.

Total revenues were stable (+0.1%) compared with the previous year (reported: +9.6%), as the higher level of equipment revenues offset the decline in other operating income and wireless service revenues. Despite rising interconnection revenues and improved trends in the residential business following the aforementioned focus on value-oriented management, wireless service revenues declined as a result of strong price pressure in the business segment in particular.

Equipment revenues increased due to volume growth and higher demand for more expensive handsets. Fixed-line service revenues increased on the back of growth in satellite TV (DTH) revenues and fixed corporate solutions.

Average monthly revenue per user (ARPU) rose by 2.2% to EUR 5.5 (2015: EUR 5.4) due to the higher proportion of contract subscribers. On a reported basis, the average monthly revenue per fixed line (ARPL) fell from EUR  11.7 in the previous year to EUR 10.8; this was due to the consolidation of Blizoo customers with a comparably low ARPL. However, reported fixed-line service revenues increased from EUR 34.9 mn in